ATO claws back nearly $50 billion in unpaid tax in just five years

Wealthy tax cheats who try to keep their yachts and art collections secret have been warned there’s “nowhere to hide”, with the ATO revealing how they catch the dodgers.

A staggering $47.8 billion has been clawed back by the Australian Taxation Office in the past five years from tax cheats as well as people making mistakes on their tax returns, it can be revealed.

That amount includes unpaid tax from hairdressers and beauty salons, cafes, restaurants and builders who were dobbed in for doing cash-in-hand deals or not declaring all sales.

The ATO has also lifted the lid on how it cross-references home loans and data matches with insurance companies to catch the wealthy who try to hide their yachts and art collections leaving “nowhere to hide”.

On top of that, the Phoenix Taskforce has unearthed $1.73 billion in unpaid tax since it was set up in March this year to target dodgy bosses winding up companies to avoid paying their debts.

The ATO-led Serious Financial Crime Taskforce has raised $1.562 billion since 2015 including $748,775 from a NSW drug dealer who lived an “extravagant” lifestyle despite not filing a tax return for 20 years. The money was seized as the proceeds of crime and put towards his tax debt.

Hairdressers and restaurants were among the businesses dobbed in to the ATO for doing cash-in-hand deals.

The usually-secretive Australian Taxation Office has revealed its “lifestyle assets data matching protocol” for wealthy tax frauds who lie about their income while having expensive cars in the garage and art works on the wall.

“This protocol means we look at data from different insurance providers for taxpayers who have accumulated assets such as fine art, private jets and yachts,” The ATO told The Daily Telegraph.

(File image) The lavish lifestyles of the wealthy are under the ATO’s scrutiny.

“We then compare this information with what is reported on their tax returns. If there is insufficient income reported on the tax return, we will investigate further.

“There’s nowhere to hide.”

Among the biggest prosecutions was that involving tax agent and chartered accountant accountant Paul Enzo Bogiatto who was ordered by the Federal Court last year to pay $22.68 million in penalties for promoting 21 tax exploitation schemes under which his clients claimed “grossly exaggerated or wholly unavailable” Research and Development Tax Incentive offset refunds.

A total of $45.5 million in R&D tax offsets were paid to Mr Bogiatto’s clients. No criminal charges were laid against him.

The Australian Taxation Office has revealed it collected $47.8 billion in tax and penalties over the past five years.

Scammer Raymond Cool was last year sentenced to two years eight months jail after claiming more than $171,000 in fraudulent GST refunds. He claimed he was providing handyman, carpentry and computer repair services under the trading name Cool Industries but had no building licence.

ATO figures that show in 2016/17, its audits including penalties and interest yielded $10.2 billion. In 2017/18, that figure was $11.8 billion, in 2018/19 it was $10.5 billion, in 2019/20 it was $9.5 billion and in 2020/2021 it was $6.8 billion after its lodgement program was modified because of Covid hardship.